ex10_3.htm


    
      
Exhibit 10.3

     

    
      STOCK PLEDGE
AGREEMENT

      


      


      THIS
STOCK PLEDGE AGREEMENT (“Agreement” or “Pledge”) is made and entered into
this  22nd day of December, 2009, by and between EMBASSY BANCORP,
INC., a Pennsylvania corporation with a principle place of business at 100
Gateway Drive, Suite 100, Bethlehem, PA 18017-9417 (the “Pledgor”); and UNIVEST
NATIONAL BANK AND TRUST CO., a national banking institution with its principle
place of business at 14 North Main Street, Univest Plaza, Souderton,
PA  18964 (“Pledgee”).

      


      Background:

      


      A.     
      Pursuant to that certain Loan Agreement of
even date herewith between Pledgor, as borrower, and Pledgee, as lender, Pledgee
has extended to Pledgor a non-revolving line of credit not to exceed the
principal sum of Four Million Dollars ($4,000,000.00) (the
“Loan”).  The Loan is evidenced by a Subordinated Term Loan Note of
even date herewith, as may be amended from time to time, in the face amount of
Four Million Dollars ($4,000,000.00) (the “Note”).

      


      B.        
    To induce Pledgee to provide the Loan to Pledgor, and as
security for the payment of all of Pledgor’s obligations in connection with
and/or under the Loan and the Note, as may be amended, from time to time, and
any and all other contracts, agreements and obligations of Pledgor to Pledgee
(collectively, the “Obligations”), Pledgor desires to pledge to Pledgee, 333,333
shares of Common Stock (“Stock”) in Embassy Bank for the Lehigh Valley (the
“Bank”).

      


      NOW,
THEREFORE, for and in consideration of the matters recited above, and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, Pledgor agrees as
follows:

      


      1.   
          Security
Interest.  Pledgor hereby pledges and grants to Pledgee a
security interest in and a lien on 333,333 shares of Stock in the Bank now owned
or hereafter acquired by Pledgor, and all cash, securities and property paid
and/or distributed to or for the benefit of Pledgor or its assignee as a
consequence of Pledgor’s ownership of the Stock, or any portion thereof
(collectively, the “Collateral”). Pledgor hereby represents and warrants to
Pledgee that, on the date of this Agreement, Pledgor owns not less than 333,333
shares of Stock in the Bank.

      


      2.      
       Obligations
Secured.  The Collateral and the continuing security interest
granted herein shall secure the satisfaction in full of all Obligations and all
amounts payable under the Note.

      


      3.         
    Delivery
of Stock and Assignments.  Concurrently with the execution of
this Agreement, all original certificates and instruments representing or
evidencing 333,333 shares of Stock owned in the name of Pledgor shall be
delivered to and held by or on behalf of Pledgee pursuant hereto and shall be in
suitable form for transfer by delivery, accompanied by duly executed instruments
of transfer or assignments in blank, in such form as Pledgee may
request.


      
        
           


        

        
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      4.     
        Covenants.  Pledgor
covenants and agrees that until all Obligations are satisfied and the amounts
due and owing under the Note have been paid in full, Pledgor shall:

      


      4.1  Sale of
Collateral.  Not sell, transfer, assign or otherwise dispose of
the Collateral, or any portion thereof, without the prior written consent of
Pledgee.

      


      4.2  Creation
of Liens.  Not create, incur or permit to exist any pledge,
encumbrance, trust, lien, security interest or charge of any kind on the
Collateral, or any portion thereof.

      


      4.3  Additional
Documents and Future Actions.  Pledgor will take such actions
and provide Pledgee, from time to time, with such agreements, financing
statements and additional instruments, documents or information as Pledgee may
reasonably deem necessary or advisable to perfect, protect and maintain its
security interests in the Collateral or any portion thereof, to permit Pledgee
to protect its interest in the Collateral or any portion thereof, and/or to
carry out the terms hereof.  Pledgor irrevocably authorizes the filing
of carbon, photographic or other copies of this Pledge, or of a financing
statement, as a financing statement, and agrees that such filing shall be
sufficient as a financing statement.

      


      4.4  Requested
Information.   Pledgor shall deliver to Pledgee such data
and information in respect of the financial condition and affairs of Pledgor and
the value of the Collateral as Pledgee may request, from time to
time.

      


      5.        
     Default.  The
occurrence of an Event of Default as defined under the Note and/or the failure
of Pledgor to perform any of its obligations hereunder shall constitute a
default (“Default”) hereunder.

      


      6.           
  Voting
Distribution and Other Rights of Pledgor and Pledgee.

      


      6.1 
          Prior to
a Default.  So long as no Default shall have occurred and is
continuing, Pledgor shall be entitled to continue to exercise any and all voting
and other rights arising under the Collateral and to receive and retain any and
all dividends, distributions and interest, declared, distributed or paid, with
respect to the Collateral, or any portion thereof.

      


      6.2   
        After a
Default.  Upon a Default and at all times
thereafter:

      


      (a) 
          Voting and
Dividends.  Pledgee shall be entitled to exercise any and all
voting and other consensual rights arising under the Collateral and to receive
and retain any and all dividends, distributions and interest, declared,
distributed or paid, with respect to the Collateral, or any portion
thereof.


      
        
           


        

        
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      (b)       
    Sale of
Collateral.  Pledgee may exercise in respect of the Collateral
any and all of the rights and remedies of a secured party upon default under the
Pennsylvania Uniform Commercial Code. In addition to the foregoing, Pledgee may
accept and take possession and title to the Stock in full or partial
satisfaction of the Obligations then owing by Pledgor to Pledgee under the
Note.  Pledgee may also sell the Collateral, or any part thereof, in
one or more blocks at public or private sale, at any exchange or otherwise or
for future delivery, and at such price or prices and upon such other terms as
are commercially reasonable. Notwithstanding the foregoing, Pledgee shall not be
obligated to make any sale of Collateral.

      


      (c)         
  Application of
Proceeds.  Any cash held by Pledgee as Collateral and all cash
proceeds received by Pledgee in respect of any sale of, collection from, or
other realization upon the Collateral, or any portion thereof, may be held by
Pledgee as Collateral for, and/or then or at any time after a Default applied in
whole or in part by Pledgee against all or any Obligations and sums owing by
Pledgor under the Note.  Any surplus of such cash or cash proceeds
held by Pledgee and remaining after payment in full of the sums owing under the
Note shall be returned to Pledgor.

      


      7.     
        Reasonable
Care.  Pledgee shall exercise reasonable care in the custody
and preservation of the Collateral in its possession.

      


      8.        
     Return of
Collateral.           Upon
the satisfaction by the Pledgor of all of its Obligations under the Note and the
termination or full performance of any agreement, contract or other arrangement
as may exist between Pledgor and Pledgee for the transfer or sale of any of the
shares of Stock to Pledgee, this Agreement and the security interest given in
the Collateral shall be terminated. Within ten (10) days thereof, the Pledgee
shall deliver the Collateral to Pledgor.

      


      9.           
  Miscellaneous.

      


      9.1  Communications
and Notices. Any notice given pursuant to this Agreement shall be in
writing, and may be telecopied, delivered by hand, mailed by first-class
certified mail, return receipt requested, postage prepaid, or dispatched by
next-day delivery service addressed, if to Pledgor or Pledgee, at the following
addresses, or at such other address as the addressee may designate
in

       

      If to
Pledgor:

      


      Embassy
Bancorp, Inc.

      100
Gateway Drive

      Suite
100

      Bethlehem,
PA  18017-9417

      Attn:  Judith
A. Hunsicker

      With a
copy to:

      Charles
J. Ferry, Esquire

      Rhoads
& Sinon LLP


      
        
           


        

        
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      One South
Market Square, 12th
Floor

      P.O. Box
1146

      Harrisburg,
PA 17108-1146

      


      


      If to
Pledgee:

      


      Univest
Corporation of Pennsylvania

      14 North
Main Street

      Univest
Plaza

      Souderton,
PA  18964

      Attn:  Philip
C. Jackson

      


      With a
copy to:

      


      Marc B.
Davis, Esquire

      Fox
Rothschild LLP

      10 Sentry
Parkway

      P. O. Box
3001

      Blue
Bell, PA  19422

      


      Any
communications given by mail in accordance herewith are deemed to have been
given three (3) business days after the date of the mailing, if a domestic
mailing, or five (5) business days after the date of the mailing, if oversees;
any communications sent by next day delivery service are deemed to have been
given the day after being sent; and communications given by any other means are
deemed to have been given when sent or delivered, as the case may
be.

      


      9.2  Severability.  The
provisions of this Pledge are deemed to be severable, and the invalidity or
unenforceability of any provision shall not affect or impair the remaining
provisions which shall continue in full force and effect.

      


      9.3  Headings.  The
headings of the Articles, Sections, paragraphs and clauses of this Pledge are
inserted for convenience only and shall not be deemed to constitute a part of
this Pledge.

      


      9.4  Binding
Effect.  This Pledge and all rights and powers granted hereby
will bind and inure to the benefit of the parties hereto and their respective
heirs, executors, personal representatives and permitted successors and assigns,
as applicable.

      


      9.5  Amendment.  No
modification of this Pledge shall be binding or enforceable unless in writing
and signed by or on behalf of the party against whom enforcement is
sought.


      
        
           


        

        
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      9.6  Governing
Law.  This Pledge has been made, executed and delivered in the
Commonwealth of Pennsylvania, United States of America, and shall be construed
in accordance with and governed by the laws of such State.

      


      9.7  No
Third-Party Beneficiaries.  The rights and benefits of this
Pledge shall not inure to the benefit of any third party.

      


      9.8 Counterparts.  This
Pledge may be executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument, and any of the parties
hereto may execute this Pledge by signing any such counterpart.

      


      9.9  No Joint
Venture.  Nothing contained herein is intended to permit or
authorize Pledgee to make any contract on behalf of Pledgor, nor shall this
Pledge be construed as creating a partnership, joint venture or making Pledgee
an investor in Pledgor.

      


      9.10
Jurisdiction
and Venue. For the purpose of any suit, action or proceeding arising out
of or relating to this Pledge, Pledgor hereby irrevocably consents and submits
to the juris­diction and venue of any of the courts of the Commonwealth of
Pennsylvania, United States of America in and for the County of Montgomery and
irrevocably agrees to accept service of process by certified mail, return
receipt requested, postage prepaid, to its address set forth herein, in lieu of
personal service.  Pledgor irrevocably waives any objection which it
may now or hereafter have to the venue of any such suit, action or proceeding
brought in such court and any claim that such suit, action or proceeding brought
in such court has been brought in an inconvenient forum, and agrees that service
of process in accordance with the foregoing sentence shall be deemed in every
respect effective and valid personal service of process upon
Pledgor.  The provisions of this paragraph shall not limit or
otherwise affect the right of Pledgee to institute and conduct an action in any
other appropriate manner, jurisdiction or court.

      


      9.11
Waiver of
Jury Trial.  Pledgor does hereby waive the right to trial by
jury in any action arising hereunder, or otherwise in connection
herewith.

      


      9.12 Indemnification.  Pledgor
hereby agrees to indemnify, defend and hold Pledgee harmless from any loss,
expense or damage on account of anything arising out of or in connection with
this Pledge, unless caused solely by Pledgee’s gross negligence or willful
misconduct.  This indemnity shall survive the repayment of the
Note.

      


      9.13
Scrivener.  Each and every
provision of this Pledge has been mutually negotiated, prepared and drafted and,
in connection with the construction of any provision hereof, no consideration
shall be given to the issue of which party actually prepared, drafted,
requested, deleted or negotiated any provision of this Pledge.


      
        
           


        

        
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      IN
WITNESS WHEREOF, Pledgor has executed this Pledge as of the day and year first
above written.

      


      
        	 
      	
                PLEDGOR:

              
	 
      	 
      	 
      
	 
      	
                EMBASSY
      BANCORP, INC.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ David M. Lobach

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                PLEDGEE:

              
	 
      	 
      	 
      
	 
      	
                UNIVEST
      NATIONAL BANK AND TRUST CO.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Philip C. Jackson

              
	 
      	 
      	
                Philip
      C. Jackson

              
	 
      	 
      	
                Market
      President

              


      

      


      


      
        COMMONWEALTH
OF PENNSYLVANIA:

         SS

      

      COUNTY OF
     
Northampton   
         :

      


      


      On
this  22nd
day  of  December, 2009, before me, a Notary Public in and
for the above County and Commonwealth, personally appeared David M. Lobach and Philip C
Jackson, who acknowledged that he executed the within instrument for the
purposes therein contained.

      


      IN
WITNESS WHEREOF, I have hereunto set my hand and official seal.

      


      


      
        	 
      	
                /s/ Maria P Nace

              
	 
      	
                NOTARY
      PUBLIC

              


      

       

       

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